Sidik v. Royal Sovereign Int'l, Inc.

THOMAS SIDIK as Administrator of the Estate of Kristen A. Sidik, deceased, THOMAS SIDIK as Parent and Natural Guardian of K.S.,an infant, and C.S., an infant and THOMAS SIDIK, Individually, PlainTtiffs, v. ROYAL SOVEREIGN INTERNATIONAL, INC., ROYAL CENTURIAN INC., RS NINGBO, INC.,ROYAL SOVEREIGN QINGDAO a/k/a. RS QINGDAO, BJ'S WHOELSALE, INC., ADT LLC and DEFENDERS, INC. d/b/a PROTECT YOUR HOME, Defendants.

ROYAL CENTURIAN INC., BJ'S WHOLESALE CLUB, INC.,ROYAL SOVEREIGN INTERNATONAL, INC. Third-Party Plaintiffs, v. TAISHAN CITY KEXINTE MOTOR PRODUCTS CO., LTD., Third-Party Defendant.

17-CV-7020 (JS)(ARL)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK

September 10, 2020

MEMORANDUM & ORDER

APPEARANCES:

For Third-party

Plaintiffs

Royal Sovereign Int'l Inc.

Royal Centurian Inc.:

Michael P. Mezzacappa, Esq.,

Stephanie B. Finding Gitnik, Esq.

Kaufman Borgeest & Ryan LLP

200 Summit Lake Drive, 1st Floor

Valhalla, New York 10595

For Third-party Plaintiff

BJ's Wholesale Club, Inc:

Joseph Daniel Velez, Esq.

Goldberg Segalla LLP

200 Garden City Plaza, Suite 520

Garden City, New York 11530

For Third-party Defendant:

Leodis C. Matthews, Esq.

Kerry James Kaltenbach, Esq.

Zhong Lun Law Firm LLP

Two Wall Street, 21st Floor

New York, New York 10005

SEYBERT, District Judge:

Third-party Defendant Taishan City Kexinte Motor Products Co., Ltd. (the "Taishan" or "Third-party Defendant") moves under Federal Rules of Civil Procedure ("FED. R. CIV. P.") 8(a)(1), 12(b)(2), and 12(b)(6) to dismiss the Third-party Complaint. (3d Pty. Compl., D.E. 73; Taishan Mot., D.E. 116; Taishan Br., D.E. 116-1; 3d Pty. Pls. Opp., D.E. 121; Taishan Reply, D.E. 126.) The Third-party Complaint seeks to recover money damages for personal injuries sustained from a portable air conditioner that caught fire, with some of the Defendants in that action, Royal Sovereign International Inc., Royal Centurian Inc., and BJ's Wholesale, Inc. (the "Third-party Plaintiffs") seeking indemnification and contribution from Taishan.

Taishan contends that the Court must dismiss the Third-party Complaint because of the lack of personal jurisdiction and because Third-party Plaintiffs have failed to state an adequate claim. Third-party Plaintiffs ask the Court to deny the motion because they have established personaljurisdiction, and, in the alternative, they seek jurisdictional discovery to make a showing of personal jurisdiction on the basis of a more fully developed record.

For the reasons that follow, the Court grants the Rule 12(b)(2) motion and denies the request for jurisdictional discovery. The Court need not reach the merits of the motion to dismiss for failure to state a claim, because the Court may dismiss the action on jurisdictional grounds. Accordingly, the Court dismisses the action as to Taishan.

BACKGROUND

I. The Underlying Action

Familiarity with the prior factual and procedural history of the case is presumed. However, by way of review, Plaintiff Thomas Sidik ("Sidik"), as the administrator of the estate of his wife, Kristen A. Sidik ("K. Sidik") and the parent and natural guardian of his children, K.S. and C.S. (and together "Plaintiffs"), brought the underlying action in December 2017 against Royal Sovereign International, Inc., Royal Centurian Inc., RS Ningbo, Inc., Royal Sovereign Qingdao a/k/a/ RS Qingdao, BJ's Wholesale Club, ADT LLC, and Defenders, Inc. d/b/a/ Protect Your Home (together the "Defendants"), after a portable air conditioner caught fire at his home. (Compl., D.E. 1, ¶ 77.) Plaintiffs alleged that Sidik's wife and children suffered severe injuries in the fire, and K. Sidik ultimatelypassed away from her injuries. (Compl. ¶¶ 78-82.) Plaintiffs also alleged that Defendants "designed, tested, manufactured, labeled, inspected, produced, imported, marketed, sold and/or distributed" the portable air conditioner that had caught fire. (Compl. ¶ 72.)

Plaintiffs raised claims for negligence, breach of express warranty, breach of implied warranty, failure to warn, strict liability, and wrongful death. (Compl. ¶¶ 83-166.) They asked for damages, declaratory relief, and costs. (Compl. at 26.) That action remains pending.

II. The Third-party Complaint and Pending Motion

In February 2019, Third-party Plaintiffs moved under FED. R. CIV. P. 14(a) for leave to file a third-party complaint against Taishan, a Chinese manufacturer of one of the portable air conditioner's component parts. (3d Pty. Pls. Mot., D.E. 69, 75.) The Court, in an opinion written by the Honorable Arthur D. Spatt, granted the motion. (Mar. 5, 2019 Order, D.E. 76.) The Court reasoned that the movants did not unduly delay the bringing of the motion, that the motion would not complicate any future trial, and that it would not cause prejudice to any party. (Mar. 5, 2019 Order at 5.)

Third-party Plaintiffs then filed the Third-party Complaint. (3d Pty. Compl., D.E. 77.) They alleged that: (1) Taishan manufactured, distributed, and sold micro motors forelectrical appliances, including the pole motor component part (the "pole motor") of the portable air conditioner believed to be the cause of the fire that gave way to the underlying action; (2) the Court had supplemental jurisdiction over Taishan under 28 U.S.C. § 1367(a) because it related to the Plaintiffs' underlying claims and formed part of the same case and controversy; (3) Taishan's negligence solely caused any injuries suffered by the Plaintiffs; (4) Taishan has contracted to, inter alia, supply goods and solicit business in the United States, and in particular, the State of New York; (5) the Third-party Plaintiffs purchased the pole motor from Taishan and used it in the portable air conditioner without a substantial change in its condition; (6) Taishan was to blame for injury to Plaintiffs; and (7) if Plaintiffs recovered damages against the Third-party Plaintiffs, or if the Third-party Plaintiffs were found liable to Plaintiffs in any way, then they were entitled to full or partial indemnity or contribution from Taishan. (3d Pty. Compl. at 6-12.)

Taishan now moves to dismiss the Third-party Complaint. (See Taishan Mot.) That motion is presently before the Court.

DISCUSSION

The Court grants the motion to dismiss on Rule 12(b)(2) grounds and denies the request for jurisdictionaldiscovery. Because the Court lacks personal jurisdiction over Taishan, it does not rule on whether the Third-party Plaintiffs failed to state a claim.

I. The Rule 12(b)(2) Standard

Rule 12(b)(2) authorizes a party to seek dismissal on the ground that the Court lacks personal jurisdiction over her or it. See, e.g., Eyeking, LLC v. JSS, LLC, 321 F. Supp. 3d 326, 329 (E.D.N.Y. 2018). "'The plaintiff bears the burden of demonstrating personal jurisdiction over the person or entity being sued.'" Out of Blue Wholesale, LLC v. Pac. Am. Fish Co. Inc., No. 19-CV-0254, 2019 WL 3997393, *3 (E.D.N.Y. Aug. 23, 2019) (quoting State of N.Y. v. Mountain Tobacco Co., No. 12-CV-6276, 2016 WL 324970, at *4 (E.D.N.Y. Jan. 26, 2016)); see Penguin Grp. (USA) Inc. v. Am. Buddah, 609 F.3d 30, 34 (2d Cir. 2010). The procedural posture of the case determines the scope of the plaintiff's burden. See Mountain Tobacco Co., 2016 WL 324970, at *4 (citing Ball v. Metallurgie Hoboken-Overpelt, S.A., 902 F.2d 194, 197 (2d Cir. 1990)). "Where, as here, a district court in adjudicating a [Rule 12(b)(2)] motion . . . 'relies on the pleadings and affidavits, and chooses not to conduct a full-blown evidentiary hearing, plaintiffs need only make a prima facie showing of personal jurisdiction.'" S. New England Tel. Co. v. Glob. NAPs Inc., 624 F.3d 123, 138 (2d Cir.2010) (quoting Porina v. Moward Shipping Co., 521 F.3d 122, 126 (2d Cir. 2008)).

A plaintiff must satisfy three elements to establish personal jurisdiction over a defendant: "'(1) procedurally proper service of process on the defendant; (2) a statutory basis for personal jurisdiction; and (3) the exercise of jurisdiction must be consistent with constitutional due process principles.'" Roxx Allison Ltd. v. Jewelers Inc., 385 F. Supp. 3d 377, 380 (S.D.N.Y 2019) (quoting Quinio v. Aala, 344 F. Supp. 3d 464, 479-80 (E.D.N.Y. 2018) (internal quotation marks omitted)). "In a diversity action, whether a court has personal jurisdiction over a defendant 'is determined by the law of the forum in which the court sits'"--in this matter, New York. Rosenblatt v. Coutts & Co., A.G., 750 F. App'x 7, 9 (2d Cir. 2018) (summary order) (quoting Cutco Indus., Inc. v. Naughton, 806 F.2d 361, 365 (2d Cir. 1986)); Kronisch v. United States, 150 F.3d 112, 130 (2d Cir. 1998) (declaring that a federal court's personal jurisdiction over a non-resident defendant is governed by the law of the forum state, subject to certain constitutional limitations of due process).

II. Application to the Facts of this Case

Third-party Plaintiffs assert that the Court has general jurisdiction over Taishan because Taishan does business in New York and is therefore present in the state pursuant toSection 301 of New York's Civil Practice Law and Rules ("C.P.L.R."). (3d Pty. Pls. Opp. at 8-10.) They support this claim by contending that: Taishan's website alleges that the company does business in every state in the United States; the company sells products on online marketplaces such as Amazon and Alibaba; and the company's general manager admitted in a declaration that the company transacts business with Whirlpool Corporation. (3d Pty. Pls. Opp. at 8-10.) As to this last point, Third-party Plaintiffs argue that "Taishan City expected or should have expected that, by virtue of its business with relationship with a company like Whirlpool, any defect in its products would have consequences in New York." (3d Pty. Pls. Opp. at 9.)

Third-party Plaintiffs further claim that the Court has specific jurisdiction over Taishan pursuant to Section 302 of the C.P.L.R. (3d Pty. Pls. Opp. at 10-15.) They argue that Taishan either expected or should have reasonably expected that its acts would have consequences in New...